Code of conduct close, says supermarket
Coles boss Ian McLeod confirmed on Wednesday a voluntary code with suppliers could be four to six weeks away, with nearly 90 per cent of questions between the key players, retailers and grocery suppliers settled.
However, Mr McLeod warned, any voluntary code governing how supermarkets deal with suppliers should not impose extra costs and bureaucracy on the supermarkets and suppliers.
"I think they [suppliers] just want to know where they stand so there is a code of practice we can agree to and principles we can follow to give people security and peace of mind when negotiating with the main retailers."
Talks between suppliers — through the Australian Food and Grocery Council — and supermarkets began last year but no deal has been reached as the parties disagree on fundamental matters.
Recently, the National Farmers' Federation pulled out of the talks. "That dialogue is still continuing and to date those conversations have been very constructive," Mr McLeod said.
The Australian Competition and Consumer Commission has said its recent investigations into alleged improper behaviour by supermarkets in dealing with suppliers would not stop if a voluntary code was agreed.
Coles' director of merchandise, John Durkan, said a final draft of a code of practice could be ready by the end of next month.
Frequently Asked Questions about this Article…
The proposed voluntary code of conduct is an agreed set of principles and a code of practice for how major supermarkets like Coles and Woolworths deal with grocery suppliers. Its aim, according to Coles' leadership, is to give suppliers clarity, security and peace of mind when negotiating with the main retailers and could reduce political pressure for a mandatory government code.
The talks involve leading supermarkets Coles and Woolworths, grocery suppliers represented through the Australian Food and Grocery Council, and other industry groups. The National Farmers' Federation recently pulled out of the discussions, according to the article.
Coles boss Ian McLeod said a voluntary code could be four to six weeks away, and Coles' director of merchandise John Durkan said a final draft of a code of practice could be ready by the end of next month — though both timeframes were presented as possibilities rather than guarantees.
Coles reported that nearly 90 per cent of questions between the key players — retailers and grocery suppliers — have been settled, indicating substantial progress though some fundamental matters remain unresolved.
Coles' Ian McLeod warned that any voluntary code should not impose extra costs or additional bureaucracy on supermarkets and suppliers. The company has emphasised the need for a practical code that provides clarity without unnecessary red tape.
Yes. The article says the National Farmers' Federation pulled out of the talks. However, Coles described the overall dialogue as continuing and said conversations to date had been constructive.
No. The Australian Competition and Consumer Commission (ACCC) has said its recent investigations into alleged improper behaviour by supermarkets in dealing with suppliers would not stop even if a voluntary code is agreed.
Investors should track development milestones such as whether a final draft is published, suppliers' participation (for example the National Farmers' Federation's position), any statements from Coles or Woolworths about implementation, and ongoing ACCC investigations — all of which could affect supermarket-supplier relations and regulatory risk.
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